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Trump administration considering major changes to security clearance program

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The Trump administration may move the vast majority of the governmentwide security clearance program from the Office of Personnel Management and National Background Investigations Bureau (NBIB) back to the Pentagon.

Multiple sources said top administration officials, including Office of Management and Budget Director Mick Mulvaney, OMB’s Deputy Director for Management Margaret Weichert, Director of National Intelligence Dan Coats and Principal Deputy Director of National Intelligence Sue Gordon met last week to discuss the transfer.

Though sources said the transfer is still predecisional, the White House at one point was considering an announcement as early as Monday.

“The administration is committed to transforming the way in which background investigations are conducted in order to improve timeliness, to best protect our most sensitive information and ensure a trusted workforce,” OMB and OPM said in a joint statement to Federal News Radio. “The administration is actively analyzing the government-wide impacts of current plans for DoD to assume responsibility for its own investigations and will soon make a decision on the future of the government-wide program that is consistent with our efforts to improve the overall effectiveness and efficiency of government.”

OPM’s future scope uncertain

Some agencies, such as the CIA, FBI and State Department, may retain their current, delegated authority to continue processing their own background investigations, according to sources. But it is unclear whether NBIB employees could get job offers to continue their work at the Defense Security Service, and there are few details about the transfer and how it would impact OPM’s workforce of federal and contracted investigators.

The move would cement the Defense Department’s stature as the governmentwide security clearance provider, a responsibility that OPM has held since the Pentagon gave up the program in 2005.

At the same time, multiple sources said the administration is also considering a move of another OPM program, HR Solutions. The administration may move the program, which offers products and services to help agencies with their human resources needs, from OPM to the General Services Administration.

“Providing HR products and services to federal agencies is a core function of OPM,” both the agency and OMB said in a statement to Federal News Radio. “OPM will continue these efforts and support agencies in the development and execution of their management initiatives. Any further discussion is deliberative and predecisional.”

Losing both NBIB in its current form and HR Solutions would have significant implications for OPM, which relies on a revolving fund and a total appropriation of nearly $261 million in fiscal 2018. Not only would the agency lose two of its highest earning activities, but the transfer could also create financial instability for OPM.

And the move of both HR Solutions and the security clearance program begs broader questions about the philosophical direction the administration is planning for OPM, whose new director has been in office for about a month. The administration has also tasked OPM with leading an ambitious review of a 40-year-old civil service law — the very law that created the agency back in 1979.

“Fragmented” leadership at NBIB

The decision to move the entire clearance program would come just as the Defense Department is beginning a three-year effort to transfer all defense personnel clearances from NBIB back to the Pentagon. Citing a backlog of 700,000 and lengthy wait times for a completed investigation, lawmakers signed off on the plan in the 2018 National Defense Authorization Act. The 2018 act specifically authorized DoD to begin conducting all of its own background investigations by 2020.

This move, though it got little publicity and public attention from Congress, worried some members of industry, who said last fall that the original DoD plan bifurcated an already complex background investigation process that had its inherent challenges.

Now, it appears some members of the administration shared those concerns all along.

“There was a pretty strong sense that it shouldn’t be broken up,” a former government executive with knowledge of OPM said of the security clearance process. “Some of it at DoD and some of it elsewhere would have had the potential for a lot of confusion and first and second class citizens. There was some sentiment that the worse case was for only part of it to move and that keeping it in its entirety somewhere was better than what was envisioned in the NDAA.”

Mark Robbins, chairman of the Merit Systems Protection Board and a former OPM general counsel during the Bush administration in the early 2000s, worked for the Trump transition as a member of the OMB management team. He said he and his team members had flagged the NBIB and the security clearance program as one that warranted early attention from the incoming Trump administration.

As the transition teams sent briefing papers up the chain of command before the 2016 election, the NBIB was just getting off the ground.

Robbins said the transition team highlighted the NBIB’s fragmented leadership structure. The Obama administration stood up the NBIB as a semi-autonomous agency in October 2016. President Barack Obama appointed veteran investigator Charlie Phalen to lead the new agency. As NBIB director, Phalen reports to the OPM director, but also looks to the ODNI for policy changes and guidance on the security clearance program.

“The main issue is who’s in charge,” Robbins said of the NBIB.

The agency also warranted the Trump team’s attention, simply because it was new, Robbins said. It is unclear what form the Trump administration’s decision to transfer the governmentwide clearance program would take.

Obama signed an executive order in 2017, during the final days of his administration codifying the NBIB as the “primary executive branch service provider for background investigations” and ensured NBIB’s delegation of investigative authority would remain in place unless another president amended or revoked the order.

It is unclear whether President Donald Trump is prepared to take executive action specifically revoking the 2017 order, but Obama’s EO, as it stands, certainly gives NBIB delegating authority to perform the majority of government’s security clearance work.

If in fact the NBIB does disappear, or ceases to exist in its current form, the move could have organizational and financial impacts on OPM.

Impact to OPM workforce unknown

National Background Investigation Bureau Director Charlie Phalen testifies before the Senate Intelligence Committee as lawmakers examine problems and practices of issuing security clearances to government employees, at the Capitol in Washington, Wednesday, March 7, 2018.

Without either NBIB or HR Solutions, OPM would also be left with five of its current seven major operations. The agency’s healthcare and insurance and retirement services would remain, while its policy offices — employee services, and merit system accountability and compliance — would likely stay as well. It is unclear whether OPM’s suitability executive agent programs would also stay intact with a transfer of the entire governmentwide security clearance program.

It is also unclear how such transfers would impact the OPM workforce. NBIB has about 3,350 full-time federal equivalents, according to OPM’s 2019 budget justification. HR Solutions has about 460 FTEs.

The possible move of HR Solutions could by sparked by a skepticism with the program, whose services and products agencies purchase to help them better comply with hiring, staffing and HR policies — policies that OPM itself creates.

HR Solutions brings in about $206 million, while the NBIB generates about $1.4 billion, according to OPM’s 2019 budget justification to Congress.

Both NBIB and HR Solutions support OPM in other ways beyond simply generating revenue for the agency. Both offices support OPM by using the agency’s common services — IT, contracting, security, general counsel and other resources. OPM relies on those resources to support its overhead costs.

And as Federal News Radio previously reported, OPM was already anxious about DoD’s plan to transfer its own investigations back to the Pentagon. It raised concerns that moving 75-to-80 percent of all background investigations from NBIB to DoD would negatively impact its own efforts to whittle down the existing backlog and would put a major dent in its operating budget and personnel capacity.

But experts in the security clearance space say it will take much more than a seat-change to spark a real, meaningful transformation that the background investigation program needs.

“Just moving the responsibility around isn’t going to fix the problem unless there’s a process improvement,” said the former government executive with knowledge of OPM.

Governmentwide approach suggested

The Professional Services Council has long advocated for a “whole-of-government” approach to the security clearance program.

“In the long run, consolidating NBIB and DoD has the potential to bring positive results to some of those challenges,” PSC President and CEO David Berteau said in a statement. “However, an organizational realignment alone cannot fix either short-term issues, such as the unacceptable backlog size or delays for clearances, or long-term issues, such as the development and deployment of a robust case-management system and other process improvements.”

The administration should pursue better technology and explore continuous evaluation as a way to improve reciprocity and investigation timeliness, regardless of who leads the clearance program, Berteau added.

Others feel the same way.

“A governmentwide approach is needed and our government counterparts have not only heard us but have internally acknowledged this to be true,” Jonathan Clifford, director of national security for the Information Technology Alliance for the Public Sector, said in a statement to Federal News Radio. “Leveraging the tools of technology is the optimal way to not only solve the problematic backlog but to make our nation more secure from background checks to continuous evaluation. We encourage this decision to be deliberative and take stock of the workforce and systems that are needed to drive this process.”

Members of industry strongly advocated for new process improvements to the security clearance program in a March hearing before the Senate Intelligence Committee.

Robbins said he had not heard about the administration’s possible plans to move the governmentwide security clearance program. But with nearly 20 years experience in the federal investigations space, the idea of transferring the clearance program back to the Pentagon “comes full circle.”

“We’re going around the same circle over and over again,” he said. “We haven’t moved to anything new.”